The CBI has responded to today's Budget speech by the Chancellor George Osborne.
John Cridland CBI Director-General, said:
“The Budget will put wind in the sails of business investment, especially for manufacturers.
“This was a make or break budget coming at a critical time in the recovery and the Chancellor has focussed his firepower on areas that have the potential to lock in growth.
“It’s encouraging to see higher than expected growth in the short-term, but as the Chancellor recognised, tough challenges remain ahead, so it’s right that the Budget reflected the fiscal reality.
“The economy needs to rebalance and this Budget will help businesses hungry to invest and export.
“The CBI has pushed hard for this significant and much-needed energy package that will help keep manufacturing jobs in the UK, while underpinning vital investment in new energy.
“Our energy intensive industries are crucial to building a low-carbon economy and it's right the Government is taking action to mitigate the cost for these firms. But many more businesses across the country are struggling with high energy costs and these measures will help support key sectors against tough international competition.
“We now need to see action from ministers to secure an ambitious EU-wide 2030 emissions reductions target to drive investment in our low carbon future.
Supporting growing businesses
“The CBI has long called for action to help provide our small and medium-sized firms with the tools they need to grow and invest.
Annual Investment Allowance (AIA)
“The doubling and extension of the AIA will be a shot in the arm for businesses ready to invest and drive the recovery.
Seed Enterprise Investment Scheme (SEIS)
“The Government has heeded our call to make the SEIS permanent to boost the range of financing options available to growing businesses and spur greater use of equity finance in small firms.
Rise in R&D tax credit for small and medium-sized firms
“The extension of the R&D tax credit will boost early stage, innovative businesses which can often be loss-making in their early years.
Getting Britain building
On extending phase 1 of Help to Buy
“Housebuilders of all sizes, in all regions, will welcome the Chancellor's move. Extending Help to Buy will offer greater certainty to housebuilders looking to deliver new homes, while the new loan scheme for smaller firms will support new entrants into the market.
“Businesses in some of the hardest hit regions will welcome the additional funding for flood defences and pothole repair to reverse the damage inflicted on homes, families and commercial activities this winter.
Air Passenger Duty
“With the UK’s air taxes the highest in the EU, it’s good to see the Chancellor taking action to tackle the most damaging aspects of this tax. But there is still more to do to cut costs on short- and long-haul routes and help exporters get a leg up in new markets.
“The doubling of the direct lending scheme and the cutting of its interest rates should strengthen the UK export finance armoury. The Government must now work much harder to promote these schemes, since many fast-growing firms are unaware of the support available.
On changes to the pensions and ISA systems
“On pensions, what’s important is that people on low incomes can make more informed decisions on defined contribution schemes. For many, that will still mean taking advice and buying an annuity, but the increased flexibility will be welcomed. In the long-term, greater flexibility might encourage people to save more for their pensions.
"We are pleased that the Government has chosen to consult on the implications of making a similar change to defined benefit pensions as stability for these schemes is essential.
"Changes to the ISA system reflect our call to help rebuild a savings culture.
“Apprenticeships are a crucial tool in fighting skills shortages and youth unemployment, so this additional support is very welcome – especially for smaller firms wanting to do more. We still need to better demonstrate the benefits of apprenticeships to young people.”